Yea Dwayne, I turned off the phishing which didn't help much so I'm now running Firefox on both my machines. It's faster than IE ever was. I've only got a few problems with some of the Firefox plug-in's right now.
I'll wait a while to see what happens with IE8. They'll probably fine some major security issue with that one also.

Thanks for all your replies....found all the information really interesting although I didn't understand everything you mentioned.I am seriously thinking about installing spybot that Penny posted about. I had a brief look at the site and it does seem a bit complicated with all the sections it has but if it stops the trojans better than my security suite then it will be worthwhile installing it.I have to say that my virus protection does seem to be effective as its always blocking malware probes.

Getting back to the new XP3 service pack, I have decided to leave things as they are.Fredo made a comment that he thought things were still the same when he upgraded and as I seem to have no problems I might as well leave things as they are.

Ever since I installed Firefox after the MS update my browser problems were finally fixed. No more 20 second wait for the home screen to appear, very quick compared to IE. More secure from what I hear. The only think I don't like about it is the way the book marks are displayed.
I suppose the XP 3 is doing it's job properly but I've given up using IE for good.